“Boate Kiss” and Brazilian Public Policy

In the classic Hollywood film “Casablanca,” the character Vichy Captain Louis Renault (played by Claude Rains) is given a directive from his Nazi overseers to find an excuse to shut down "Rick's Café Américain" run by Humphrey Bogart’s character Rick Blaine. Captain Renault announces, “I am shocked, shocked to find that gambling is going on here.” Immediately after this announcement, Rick’s croupier hands Renault a stack of money: “Your winnings, sir.” As this scene demonstrates, the character of Captain Renault is designed to epitomize hypocrisy and bureaucracy as a condemnation of the collaboratist Vichy régime.

In the early morning hours of January 27, 2013, a fire broke out in the nightclub “Kiss” in the southern Brazilian town of Santa Maria. The death toll was 242, with another 116 injured, many of them seriously. Almost every victim was in their late teens or early twenties. The deaths resulted from horribly inadequate infrastructure, including a single entry/exit point, no emergency exits and barred windows that condemned many of the youth to a charred death in the restrooms as they tried to flee the inferno. The tragedy affected every family in this town of 262,000 inhabitants, and traumatized the state of Rio Grande do Sul. Repercussions rippled throughout the country. It was the third largest number of deaths in a nightclub in world history, and was eerily similar to the 2003 fire in the Station nightclub in Rhode Island in which 100 people died, and the República Cromañón nightclub fire in Buenos Aires that killed 194 people in 2004. In all three cases, indoor pyrotechnics, over-crowding, and inadequate evacuation escalated the loss.

In the immediate aftermath of the tragedy, local and state governments quickly raised the alarm about public safety in bars, nightclubs, and similar venues. Government officials were shocked, shocked to find that the vast majority of these establishments were functioning without conforming to fire and public safety codes. In the state capital of Porto Alegre, approximately 46 out of 50 registered night spots were shut down in the weeks after the fire due to noncompliance with the codes governing the operation of public establishments. In Santa Maria it was discovered that Fire officials knew of the noncompliance at “Kiss” yet for some reason the venue not only remained open but was allowed to regularly host musical acts that included indoor pyrotechnics. The venue’s official capacity was 691 persons, yet normally – and on the night of the tragedy – between 1,000 and 1,500 people were admitted.

While there was clear negligence on the part of the establishment’s owners, the greater breakdown was on the part of Brazil’s de facto public policy that accepts legal infractions as regular practice. Public officials in Santa Maria were aware of the overcrowding; some officials’ own children frequented the trendy club, and some died. Fire officials were aware of the bolted emergency exits, barred windows, and restricted main entry. From July 31, 2009, until the night of the fire, the nightclub operated continually under improper conditions, yet public officials never fully enforced regulations. The club was even ordered shut down, but the order was never carried out. Instead, the establishment was fined four times. The amount of the fines obviously was all but meaningless in face of the huge profits, another element in the inadequacy of public policy. For such measures to be effective, the value must be significant enough to deter infraction and not simply a small part of the cost of doing business. Similarly, there must be real enforcement of regulations, especially in areas of public safety.

Today marks the four-month anniversary of the tragedy. In this time, many actions have been taken at the local, state and national levels. Major reviews of operating licenses have revealed similar defects throughout the country; in the city of Rio de Janeiro, for example, only 5% of the 209 registered nightclubs conformed to fire safety codes. Commissions, investigations, and hearings have emerged across Brazil. Yet all of this will be meaningless unless followed by an actual change in how the people and the government perceive and act on issues of public safety. Conditions at the “Boate Kiss” were no secret, yet for three and a half years government officials allowed the nightclub to operate as a deathtrap.

Obama in Mexico: But what Mexico was he talking about?

Last Friday (05/03/13), U.S. President Barack Obama gave a speech at the National Museum of Anthropology in Mexico City during which he highly praised the great socio-economic progress currently taking place in that country.  While much of Mexico’s mainstream press reported positively on the bilateral meetings between Obama and his counterpart, Mexican President Enrique Peña Nieto, and lauded Obama’s speech, the U.S. media took a different slant, fueled primarily by an article in the Los Angeles Times, “Obama sings Mexico's praises, but some Mexicans hear flat notes” (http://www.latimes.com/news/world/worldnow/la-fg-wn-mexico-obama-reaction-20130503,0,2714566.story). The Times story was picked up by wire services and became the dominant view of the speech in the U.S. media. It included numerous quotes, such as:

“‘[That was] a really good speech by President Obama, but what Mexico was he talking about?’ said Jose Carlos Cruz, 24, a graduate student in international relations.”

“Alberto Rios Lara, 26, who is studying to be an economist, said, ‘Obama is a great speaker; it's really impossible not to feel excited. However, the reality is different in Mexico. We need more action and fewer speeches.’"

The two major issues in U.S.-Mexico relations are drug trafficking and illegal immigration. Obama’s words can be interpreted as a call for Mexicans to stay at home in Mexico, a position that echoes the sentiments of Peña Nieto. The latter wants to showcase how the return to power of the Institutional Revolutionary Party (PRI – Partido Revolucionario Institucional) has brought economic growth and stability to Mexico. At the same time, Peña Nieto has stepped back on cooperative ventures with U.S. law enforcement in the area of drug trafficking, trying to foster an image of self-sufficiency. Nevertheless, Peña Nieto has to worry about the collateral effects of any U.S. economic slowdown and how it could affect Mexico’s growth. As primary trading partners, both the U.S. and Mexico have vested interests in shoring up their mutual commerce. According to the Mexican newspaper El Universal, there’s cause for concern in Mexico that a slowing U.S. recovery will adversely impact Mexico (http://www.eluniversal.com.mx/notas/921054.html). The paper reported that in 2012, the U.S. economy grew by 2.2% annual rate, compared to 1.8% in 2011. Nevertheless, the last quarter showed signs of weakening, dropping from 3.1% in the third quarter to -0.1% in the fourth. The article claims that this slowing will hurt Mexico’s GDP, whose 3.9% growth in 2012 is projected to slow to 3.5% this year. This is why Peña Nieto’s government was so enthusiastic about Obama’s cheerleading, releasing a statement that “both governments are committed to working to make the North American region the most competitive and dynamic in the world,” according to a spokesperson for the Ministry of Finance and Public Credit (SHCP - Secretaría de Hacienda y Crédito Público). This is reflected in the opening address of the SHCP Minister, Luis Videgaray, at the G24 press conference in Washington, D.C. on April 18, 2013. Videgaray indicated emphasized, “This means that we still face very important challenges starting out with the crisis, financial imbalances, fiscal imbalances that create relevant risks for G24 countries. We need to, in parallel, push forward a pro-growth productivity-based agenda” (http://www.shcp.gob.mx/SALAPRENSA/doc_discurso_funcionarios/secretarioSHCP/2013/lvc_conferencia_g24_ing.pdf).

In spite of Obama’s and Peña Nieto’s expressed optimism in Mexico’s social and economic outlook, the very real specter of violence, poverty and death haunts U.S.-Mexico relations. The drug cartel wars now stretch across the entire length of the shared border, leaving tens of thousands dead annually. This violence together with rampant poverty push thousands more to seek opportunities in the U.S. With post-9/11 tightened security, most people entering the U.S. illegally risk their lives crossing through extreme desert environments. The NGO Humane Borders has compiled a map of confirmed fatalities in southern New Mexico. It reports 2,269 deaths from 10/01/99-03/28/12 (http://www.humaneborders.net/warning-posters/).

 These are the realities that will require serious cooperation, and not just speeches, on both sides of the line in the sand.

Disenchantment with Lula

In 1982, the late historian Robert Levine¹ gave an informal address to a group of American college students attending the University of São Paulo in Brazil. He made a statement that did not go over well with most of the politically engagé students assembled. In referring to the entrenched corruption of both civil and official societies, Levine commented that it didn't matter who was the president since the bureaucracies and practices of daily life would remain the same. He concluded that you could have Lula² or Maluf³ as president and nothing would change. The underlying issue as identified by Levine was the need for reform in the very fabric of society.

It is often said that in Brazil there are two ways to accomplish any task, the official way and the unofficial way or “jeitinho.” Some scholars have postulated that the (in)famous “jeitinho” developed as a necessity because of the immense, and at times contradictory, bureaucracies that can bring to a halt almost any interaction with official organs. The need for society to function leads to extra-official practices enacted by functionaries who deal directly with those seeking resolution.  Obviously, the very nature of these arrangements lead to corruption, sometimes softer – such as a donation to the “coffee fund” (pagar o cafezinho) or the “tip box” (caixinha dois) – and other times more blatant and abusive. A major problem is the wide-spread acceptance of the practice as a simple fact of life and cost of doing business in Brazil. This reality is so entrenched in Brazil that some U.S. businesses found themselves unable to do business in Brazil without violating the Foreign Corrupt Practices Act of 1977 (FCPA) and the International Anti-Bribery and Fair Competition Act of 1998, which prohibit the bribing of foreign officials.

Luis Inácio “Lula” da Silva was a founder of the Brazilian Workers’ Party or PT (Partido dos Trabalhadores) in 1980 when the last military president, João Figueiredo, abolished the prescriptive bipartisan political system and allowed for the organization of new parties under the “Political Opening” (Abertura Política). In addition to several elected offices, Lula ran for President of the Republic in 1989 and 1994, losing both times in the second round run-offs, first to Fernando Collor de Mello and later to Fernando Henrique Cardoso. Throughout his political career up to that point, Lula distinguished himself as a tireless union organizer and social reformer. The Workers’ Party, whose symbol is a red star, was the farthest left party legal in Brazil when it was formed, and its platform included policies of redistribution of wealth including agrarian reform. In the years prior to his eventual election as president, Lula was often portrayed even by his detractors as perhaps Brazil’s only “honest politician.” In preparing himself to run again in the 2002 elections, Lula adopted a significantly different public persona, opting for smartly tailored suits and trimmed beard in place of his signature casual shirt sleeves and bushier facial hair. One of his first moves was to meet with the powerful Federation of Industries of the State of São Paulo (FIESP), the most significant industrial organization in the country and a long-time opponent of a Lula presidency. Lula assured these economic leaders that he would not threaten their hegemony and would maintain the economic policies of his predecessor, Fernando Henrique Cardoso. Most of his hardcore supporters probably assumed that this was merely a ploy to get into office, the ends justifying the means. However, once elected Lula was good to his word largely left unmodified the policies that had led to the economic stability under Cardoso. This policy alienated some of his party’s staunchest vanguard and led to sharp criticism from within the political left. However, Lula’s overall popularity grew during his presidency, at one point achieving the highest ever approval ratings for a Brazilian president. In 2009, Barack Obama referred to Lula as "the most popular politician on Earth" during a G20 summit in London.

Nevertheless, in 2005 during Lula’s presidency a massive influence peddling scheme operated within the corridors of the National Congress. Known as the “mensalão”(more or less the big monthly allowance), suitcases full of money regularly were brought into congressional offices, somehow bypassing security stations. These were distributed across a broad spectrum of political offices under the supervision of Lula’s Chief of Staff, José Dirceu. Ultimately, after the scandal broke, numerous members of Lula’s cabinet and other office holders lost their jobs, some eventually being indicted. Reminiscent of the Watergate scandal in the U.S., the question that surfaced regarding the president was, “What did he know and when did he know it?” While Lula was never directly implicated in the corruption, with wry humor, the joke at the time was: The good news is that Lula knew nothing about the payoffs. The bad news is that Lula knew nothing about the payoffs.

Lula’s popularity remained high throughout his presidency, enough so to allow current president Dilma Rousseff to coat-tail into the presidency after filling Dirceu’s post at the end of Lula’s second term. In August 2007, 40 participants were indicted by Brazil’s Supreme Court, almost all political allies of Lula and the PT. The trial began five years later, and many of the defendants were convicted of various charges of corruption. José Dirceu and several others were convicted of bribery (corrupção ativa).  

Even though Lula has managed to maintain a certain distance from the proceedings, his legacy has been tainted by the detailed revelations that continue to surface stemming from the trials and their aftermath. The image that has gradually supplanted that of “the one honest politician” seems to be that of “just another politician.” Those who most ardently supported Lula, and in some cases the Workers’ Party itself, have grown steadily more disillusioned.

NOTES

1. Robert M. Levine (1941-2003) was a scholar of Latin American history with a special emphasis on Brazil. When he addressed the American students in 1982, he was visiting his long-time friend and fellow historian José Carlos Sebe Bom Meihy, then the Director of the Interuniversity Study Program (ISP-USP). Years later when I was at Florida International University and Bob was at the University of Miami, he was surprised to have made such a remark, being a strong supporter of Lula’s various political activities.

2. Luis Inácio “Lula” da Silva (b. 1945) was president of Brazil from 2003-2010.

3. Paulo Salim Maluf (b. 1931) is a Brazilian politician who has held multiple state and national offices since getting appointed Mayor of the city of São Paulo in 1969, due to his personal connections to General Artur da Costa e Silva, the second military president. His appointment was made possible by the fifth Institutional Act (AI-5) of 12/13/68, that suspended most political and civil rights, recessed the national congress, and instituted direct control of political processes by the president and governors.  In 1982, Maluf was finishing his term as Governor of the state of São Paulo and demonstrated clear aspirations to the presidency. He was a candidate for the chief executive office in 1985, supported by the out-going military régime and thus expected to become Brazil’s first civilian president since the 1964 coup. However, in a surprising upset, Tancredo Neves won the indirect election held through the Electoral College.